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Crypto in 2026: Oh, This Is the Bad Place

stephendiehl.com

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Re: Crypto in 2026: Oh, This Is the Bad Place

#81

Post by Ekaros »

RobotToaster wrote: post #47
deweller wrote: post #10

Earlier quoted context omitted.

I assume he is referring to the uptick in stablecoin adoption. USD Stable coins are US dollar-backed cryptocurrency tokens that are intended to always hold a value of $1 USD. Stablecoins are not backed by a central bank. Instead their source of value comes from a private company that holds actual US dollars or USD-equivalent reserves (like treasury bills, etc).

I've always wondered, how do the companies that run stablecoins make a profit? Are they buying treasury bonds?

Well if you pay 0 on deposits and then loan money out even just to treasuries there is money to be made. Get enough volume and it is big. Next step is riskier investments and not being fully backed... After all it is just IOU you minted yourself...

Re: Crypto in 2026: Oh, This Is the Bad Place

#83

Post by mcintyre1994 »

I do agree that there's a huge amount of fraud and scams, and obviously that's only got worse since the President of the US started being part of that ecosystem.

But at the same time there is also finally real finance happening on-chain too. Backpack launched a SpaceX token at IPO that can be moved between on-chain and your brokerage. I think Coinbase announced their on-chain equity offering will have the same capability. Just yesterday Bailie Gifford launched a tokenised fund where the actual register of record is on-chain. I still think crypto has significant potential as financial rails, and that does seem to be being explored by real financial players now too.

Re: Crypto in 2026: Oh, This Is the Bad Place

#84

Post by usrusr »

pydry wrote: post #52
INTPenis wrote: post #43

I've been sharing author's view for quite a while now, namely that there must exist a market of goods to give a currency real value. But I must contradict the author, because there is a market of goods, and bitcoin is indirectly involved in it. Namely the dark web market of drugs. People love drugs, and they use a lot of them, drugs turnover a huge amount of value. And right now people are buying bitcoin, because it'…

Ive been saying this for a while. Cryptocurrencies are an index tracker for the underground economy. They're not without value and theyre not all speculation but what value they do have is almost entirely about facilitating transactions which at least one state considers illegal. I used to think that this would mean that they'd be outright banned eventually but it seems that the "index tracker for the underground eco…

I call them ransom futures. But given how many of the ransom situations that are started with "give us N amount of crypto X!" I suspect being resolved entirely in conventional money, through some subcontractor chain of decreasingly white-hattish "security consultancies" that somehow make the problem go away (by knowing someone who will make the problem go away for money), your take is probably the more accurate one.

Re: Crypto in 2026: Oh, This Is the Bad Place

#85

Post by keiferski »

It is really striking how technologists keep disregarding any aspect of ethics, philosophy, proper usage, etc. and just focus entirely on the technology itself. Cryptocurrency, AI, social media, on and on.

I used to think it was merely an innocent ignorance, just a soft subject that technologists weren’t familiar with. But anymore it seems like actively hostile to me, a kind of blind belief in the idea that technological problems will just be magically solved by adding more technology.

Re: Crypto in 2026: Oh, This Is the Bad Place

#86

Post by ozgrakkurt »

alehrs wrote: post #50

I've been deep into crypto for years and I was a big stablecoin supporter. I was fascinated by the tech and I still am. But everything outside the tech itself is just trash, scams, and gambling. I've come to believe that "pure" decentralization is neither practical nor particularly convenient. The only real use case that makes sense to me is giving people in developing countries access to a stable currency they can a…

I live in less developed countries so it is actually useful for me but I see it the same way as you wrote here.

Low-life businessmen ruined the technology outside of some spaces where there is strong tech leadership. They did too much damage to reputation of the whole industry

They did the same butchering to LLM/AI tech.

Re: Crypto in 2026: Oh, This Is the Bad Place

#87

Post by rglullis »

pjc50 wrote: post #71
rglullis wrote: post #55

Earlier quoted context omitted.

Exactly. Cryptocurrency is useful as as a backup system against failing/weak institutions. Just that. Like insurance, it was not there to make anyone's lives better but simply to become a safeguard to avoid complete collapse.

However, I think there's an argument that the existence of that backup, or at least its marketing, might of itself encourage people to make the institutions fail so they can profit from it.

That's a weak argument. If the institutions can collapse because a few powerful people can work against it, then the institution has already failed in the first place.

Trump and the general rise of Populism is not the cause of the fall of Western democracies, it is a consequence.

Re: Crypto in 2026: Oh, This Is the Bad Place

#88

Post by thelastgallon »

> A market, she says, is a price discovery mechanism for goods and services whose value comes from outside the market itself. The price of wheat reflects something about the world. The price of a share in a public company reflects expectations about real cash flows. The price of an interest rate future reflects collective views about real monetary conditions. In every case the market is a measuring instrument for an underlying reality, and the participants take positions on that reality.

> The price of Bitcoin measures only the price of Bitcoin.

Re: Crypto in 2026: Oh, This Is the Bad Place

#89

Post by vlian2088 »

alehrs wrote: post #50

I've been deep into crypto for years and I was a big stablecoin supporter. I was fascinated by the tech and I still am. But everything outside the tech itself is just trash, scams, and gambling. I've come to believe that "pure" decentralization is neither practical nor particularly convenient. The only real use case that makes sense to me is giving people in developing countries access to a stable currency they can a…

>Outside of that, as an EU/US citizen I don't see why I'd hold stablecoins instead of fiat.

because fiat can be taken away from you.

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